Global broadband-networking markets to embrace IP with big push toward MPLS

Nov. 1, 1999

Beginning in 2002, multiprotocol label switching (MPLS) will be widespread, voice telephony will generate less than 10% of fixed network traffic, and the industry will experience consolidation through mergers and acquisitions with former national monopolies losing up to 50% of their market. This market scenario is forecast by Ovum Inc., a telecommunications industry research firm, in its new report: IP, ATM and MPLS: Strategies for Broadband Networking.

During the next few years, Ovum forecasts the general availability of routers and switches supporting MPLS to increase, with widespread availability and use after 2002. On a global scale, voice telephony will steadily decrease from between 30% and 50% through 2001 to eventually generating less than 10% of fixed network traffic. Incumbent carriers are expected to maintain their market footholds, at least through 2001, despite strong growth in the number of retail competitors and the emergence of specialized and niche players. But after 2002, their future may be less optimistic as the industry consolidates and new market leaders emerge.

According to Ovum, the world aggregate broadband Internet-protocol (IP) capacity will grow by a factor of more than 50 during the next six years-a growth of nearly 100% per annum. Growth rates outside Western Europe and North America will be well in excess of 100% growth per annum. The regions outside Western Europe and North America will grow from around one quarter of world capacity to more than one-third of all capacity, with the United States down from 50% to 40%.

Ovum's report helps operators and equipment suppliers understand the implications of what it calls the IP revolution in telecommunications. It provides advice on the future of the interface between the customer and wide area network, analysis of network development, and the integration of IP and Asynchronous Transfer Mode.

Ovum's complete report is available for $1850 by calling (800) 642-OVUM or visiting its Website: www.ovum.com.

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